A friend reads the Meta Opinion so I don't have to

Background:  The FTC’s case against Meta rested on a familiar monopolization narrative: Meta supposedly dominates “personal social networking” and preserved that dominance by buying Instagram and WhatsApp before they could blossom into competitive threats. For the theory to hold, users must be trapped on Meta’s platforms despite wanting something different, and Meta must be quietly degrading quality because—secure in its monopoly—it can.

After a full trial, the court found none of this matched the evidence. A friend of mine, who celebrated the opinion’s release with a glass of single malt, sent along a set of remarks that form the basis of this post.  

The European regulators required Meta to offer an ad-free Facebook and Instagram for €5.99 per month. Fewer than 0.01% of users subscribed. If consumers were truly desperate to flee the “oppressive” ad-supported model, one might have expected more than statistical noise. As my friend put it, this was not exactly the behavioral evidence one hopes for when arguing that users are crying out for an alternative.

Europe contributed another natural experiment when regulators mandated a choice screen for search engines on Android. Under the FTC’s theory, Google’s dominance stems largely from being the default—the search engine pre-selected for users who supposedly never bother to change it. So regulators removed the default entirely and required every user to make an active choice. Yet when presented with a perfectly neutral menu, over 98% still selected Google. It was a useful reminder that consumer preferences sometimes favor the incumbent for reasons unrelated to default settings.

The profits evidence fared no better. The FTC treated Meta’s high profits as proof of monopoly power, but did not rule out the more mundane explanations—efficiency, innovation, or providing products people actually like. Since Meta’s returns do not look unusual relative to other successful tech firms, the court concluded that “monopoly” was doing more work in the FTC’s theory than in the real world.

Then there was the “quality degradation” argument. The FTC suggested Meta raised its “quality-adjusted price” by making its apps worse over time. The record instead showed steady feature additions and billions in R&D investment. If Meta is secretly degrading its products, it is doing so in a very expensive and user-pleasing way.

Finally, the court noted that one FTC expert had previously urged the agency to bring this exact case. As my friend observed, this made the testimony feel less like neutral analysis and more like a very committed book report.

In the end, the court’s conclusion rested on the distance between the FTC’s theory and the evidence. The agency described a world in which consumers were effectively captive and Meta behaved like a textbook monopolist; the record pointed to something far less dramatic. Confronted with the gap, the court went with the evidence.

HT:  My friend supplied the irony.